MISSISSIPPI LEGISLATURE
2004 Regular Session
To: Finance
By: Senator(s) Ross, Kirby
AN ACT RELATING TO THE METROPOLITAN AREA WATER SUPPLY ACT; TO AMEND SECTIONS 51-9-189 THROUGH 51-9-205, 51-9-213 AND 51-9-221, MISSISSIPPI CODE OF 1972, TO REVISE DEFINITIONS, TO CLARIFY THE POWERS OF THE PEARL RIVER VALLEY WATER SUPPLY DISTRICT RELATING TO THIS ACT, TO PROVIDE FOR PUBLIC AGENCY PAYMENTS FOR WATER SUPPLIES FROM THE WATERWORKS, TO PROVIDE FOR AGENCY RATE ADJUSTMENTS, TO CLARIFY PROVISIONS OF AGENCY CONTRACTS WITH THE DISTRICT, TO CLARIFY THE PLEDGE OF REVENUES FOR THE ISSUANCE OF BONDS OF THE DISTRICT, TO CLARIFY THE POWER OF THE DISTRICT TO MAKE CERTAIN COVENANTS IN CONNECTION WITH THE ISSUANCE OF THE BONDS, TO AUTHORIZE THE DISTRICT TO REVISE RATES TO FULFILL THE TERMS OF COVENANTS; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 51-9-189, Mississippi Code of 1972, is amended as follows:
51-9-189. This act is for the purpose of authorizing the Pearl River Valley Water Supply District to acquire, construct, maintain and operate * * * water treatment plants and regional water distribution systems to ensure an adequate and sanitary water supply for the Jackson metropolitan area. This act may be cited as the "Metropolitan Area Water Supply Act."
SECTION 2. Section 51-9-191, Mississippi Code of 1972, is amended as follows:
51-9-191. Words and phrases used in this article shall have meanings as follows:
(a) "Act" means the Metropolitan Area Water Supply Act (this article) as originally enacted or hereafter amended.
(b) "Board of directors" means the board of directors of the district.
(c) "Bonds" means revenue bonds, interim notes (having a maturity of three (3) years or less) and other certificates of indebtedness of the district issued under this act.
(d) "District" means the Pearl River Valley Water Supply District.
(e) "Person" means and includes the State of Mississippi, any city, town, county, political subdivision or public agency of the state or of the United States of America, and any corporation, individual, partnership, association, firm, trust estate or any other entity whatsoever.
(f) "Public agency" means any city, town, public agency or political subdivision of the state authorized by law to supply water to persons within the geographical boundaries of such city, town, public agency or political subdivision.
(g) "Water supply system" means pipelines, conduits, pumping stations and all other structures, devices and appliances appurtenant thereto, including land and right-of-way thereto, for use in transporting water to * * * a point of ultimate use * * *.
(h) "Waterworks" means * * * all works, plants or other facilities, including open channels, necessary for the purpose of collecting, storing, treating and transporting water to persons or public agencies * * * for municipal, commercial, domestic, industrial, agricultural or manufacturing purposes.
SECTION 3. Section 51-9-193, Mississippi Code of 1972, is amended as follows:
51-9-193. The district, through its board of directors, in addition to any and all powers now or hereafter granted to it, is hereby empowered:
(a) To acquire, construct, operate and maintain a waterworks and water supply systems in furtherance of the purposes of this act on land now owned or hereafter acquired by it for said purpose and to construct or otherwise acquire all waterworks or other facilities deemed necessary or useful for the treatment and processing of water available or to be available to it and the transportation and supplying of such water to public agencies, the district or persons * * * for municipal, commercial, domestic, industrial, agricultural and manufacturing purposes. The district shall be the exclusive provider of potable water to residents of lands owned by the district within its project area. The district may extend water service outside its project area; however, no such extension shall be made to areas already occupied and served by a public agency or private provider rendering the same service so long as such public agency or private provider desires to continue to serve the same area.
(b) To acquire by condemnation or otherwise any and all property of any kind, real, personal, or mixed, or any interest therein, necessary or convenient to the exercise of the purposes of and the powers granted by this act. Any property acquired by condemnation shall be acquired according to the procedure otherwise provided by law for the condemnation of property by public agencies. For the purposes of this act, the right of eminent domain shall be superior and dominant to the right of eminent domain of railroad, telephone, telegraph, gas, power and other companies or corporations.
The amount and character of interest in land, other property, and easements thus to be acquired shall be determined by the board of directors, and their determination shall be conclusive and shall not be subject to attack in the absence of manifold abuse of discretion or fraud on the part of such board in making such determination. However:
(i) In acquiring lands, either by negotiation or condemnation, the district shall not acquire minerals or royalties; provided that sand and gravel shall not be considered as minerals within the meaning of this section; and
(ii) No person or persons owning the drilling rights or the right to share in production shall be prevented from exploring, developing or producing oil or gas with necessary rights-of-way for ingress and egress, pipelines and other means of transporting interests on any land or interest therein of the district held or used for the purposes of this act; but any such activities shall be under such reasonable regulations by the board of directors as will adequately protect the waterworks and water supply system of the district contemplated by this act.
(c) To require the necessary relocation or rerouting of roads and highways, railroad, telephone and telegraph lines and properties, electric power lines, gas pipelines and related facilities, or to require the anchoring or other protection of any of these, provided due compensation is first paid to the owners thereof or agreement is had with such owners regarding the payment of the cost of such relocation, and to acquire easements or rights-of-way for such relocation or rerouting and to convey the same to the owners of the property being relocated or rerouted in connection with the purposes of this act.
(d) To acquire by purchase any existing waterworks or water supply systems and related facilities providing services which the district is authorized to provide, and any lands, rights, easements, franchises and other property, real and personal, necessary to the completion and operation of such system upon such terms and conditions as may be agreed upon, and if necessary as part of the purchase price to assume the payment of outstanding notes, bonds or other obligations upon such system. For purposes of acquiring existing waterworks or water supply systems, the term "waterworks" and "water supply systems" shall include wastewater facilities operated in connection with such waterworks or water supply systems, including, without limitation, pipelines or conduits, pumping stations, force mains, treatment plants, lagoons or any other structure, device, appurtenance or facility, whether operated individually or in any combination, used for collecting, treating and/or disposing of wastewater, by either surface or underground methods, and all easements, rights-of-way and appurtenances.
(e) To enter into contracts with any person in furtherance of any of the purposes authorized by this act upon such consideration as the board of directors and such person may agree. Any such contract may extend over any period of time, notwithstanding any provision or rule of law to the contrary, may be upon such terms as the parties thereto shall agree, and may provide that it shall continue in effect beyond the life of the waterworks or water supply systems or any part thereof or the term of the bonds sold with respect to such facilities or improvements thereto, refunding bonds issued in lieu of such bonds and all other obligations specified therein * * *. Any such contract shall be binding upon the parties thereto according to its terms.
(f) To fix, charge, collect, maintain and revise rates, fees and other charges for the services rendered and water supplied to any user of the waterworks or water supply systems operated or maintained by the district, whether or not such systems are owned by the district, and to contract with any public agency for water supplies from the waterworks or water supply systems owned or operated by the district, which rates, fees, contracts and other charges shall not be subject to review or regulation by the Mississippi Public Service Commission.
(g) To make and enforce, and from time to time amend and repeal, bylaws and rules and regulations for the management of its business and affairs and for the acquisition, construction, use, maintenance and operation of any of the waterworks or water supply systems under its management and control and any other of its properties.
SECTION 4. Section 51-9-195, Mississippi Code of 1972, is amended as follows:
51-9-195. Payments by any public agency for water supplies from the waterworks or water supply systems owned or operated by the district shall be made from the gross receipts or revenues of the public agency's waterworks, water supply systems, or of its combined waterworks, water supply, sewerage and sewage disposal systems, or other combined utility systems as may be prescribed in the contract between the public agency and the district, its successors or assigns, or as otherwise authorized by law. Such payments shall constitute an operating expense of the system or systems whose revenues are thus to be applied. No provision of this act shall be construed to prohibit any public agency, otherwise permitted by law to issue bonds, from issuing bonds in the manner provided by law for the acquisition, construction, renovation, repair or development of waterworks or * * * water supply systems or any part thereof owned or operated by such public agency.
SECTION 5. Section 51-9-197, Mississippi Code of 1972, is amended as follows:
51-9-197. Whenever a public agency shall have executed a contract pursuant to this act and the payments thereunder are to be made either wholly or partly from the revenues of the public agency's waterworks, water supply systems, sewerage system or sewage disposal system or a combination of any of its utility systems, the duty is hereby imposed on the public agency to establish and maintain and from time to time to adjust the rates charged by the public agency for the services of such system or systems, such that the revenues therefrom, together with any taxes levied in support thereof, will be sufficient at all times to pay: (a) the expense of operating and maintaining such system or systems, including all of the public agency's obligations to the district, its successors or assigns under such contract; and (b) all of the public agency's obligations under and in connection with revenue bonds theretofore issued, or which may be issued thereafter and secured by the revenues of such system or systems. Any such contract may require the use of consulting engineers and financial experts to advise the public agency whether and when such rates are to be adjusted.
SECTION 6. Section 51-9-201, Mississippi Code of 1972, is amended as follows:
51-9-201. (1) Any public agency may, pursuant to a duly adopted resolution of the governing authority of such public agency, enter into contracts with the district for the district to acquire, construct, lease, improve, extend, operate or maintain a waterworks or water supply system or any part thereof or interest therein for the furnishing of water to the public agency; such contracts shall obligate the public agency to make payments to the district or to a trustee in amounts which shall be sufficient to enable the district to defray the expenses of acquiring, administering, operating and maintaining its waterworks and water supply systems, to pay interest and principal (whether at maturity or upon sinking fund redemption) on bonds of the district issued pursuant to this act and to fund reserves for debt service, for operation and maintenance and for renewals and replacements, and to fulfill requirements of any rate covenant with respect to debt service coverage contained in any resolution, trust indenture or other security agreement relating to the bonds of the district issued pursuant to this act. Any public agency shall have the power to enter into such contracts with the district as in the discretion of the governing authorities thereof would be in the best interest of such public agency. Such contracts may include a pledge of the full faith and credit of such public agency for payment of such amounts due under such contracts. Any such contract may provide for the sale or lease to or use of by the district of the waterworks, the water supply systems or any part thereof of the public agency; may provide that the district shall operate the waterworks, water supply systems or any part thereof of the public agency; may provide that any public agency shall have the right to continued use and/or priority use of the waterworks, water supply systems or any part thereof of the district and the water supply made available thereby during the useful life thereof upon payment of reasonable charges therefor; may contain provisions to assure equitable treatment of persons or public agencies who contract with the district pursuant to this act; and may contain such other provisions and requirements as the parties thereto may determine to be appropriate or necessary. Such contracts may extend over any period of time, notwithstanding any provision of law to the contrary, and may extend beyond the life of the waterworks or water supply systems or any part thereof or the term of the bonds sold with respect to such facilities or improvements thereto.
(2) The obligations of a public agency arising under the terms of any contract referred to in this act, whether or not payable solely from a pledge of revenues, shall not be included within the indebtedness limitations of the public agency for purposes of any constitutional or statutory limitation or provision. To the extent provided in such contract and to the extent such obligations of the public agency are payable solely from the revenues and other monies derived by the public agency from the operation of its waterworks, water supply systems or combined utility systems or any part thereof, such obligations shall be treated as expenses of operating such systems.
(3) Contracts referred to in this section may also provide for payments in the form of contributions to defray the cost of any purpose set forth in the contracts and as advances for the waterworks or water supply systems or any part thereof subject to repayment by the district. A public agency may make such contributions or advances from its general fund or surplus fund or from any monies legally available therefor.
(4) Payments made or to be made to the district by a public agency or other person pursuant to a contract for the waterworks or water supply systems or any part thereof and the use of the water made available thereby shall be determined by the method specified in such contract and shall not be subject to approval or review by the Mississippi Public Service Commission.
(5) Subject to the terms of a contract or contracts referred to in this act, the district is hereby authorized to do and perform any and all acts or things necessary, convenient or desirable to carry out the purposes of such contracts, including the fixing, charging, collecting, maintaining and revising of rates, fees and other charges for the services rendered and water supplied to any user of the waterworks or water supply systems operated or maintained by the district, whether or not such systems are owned by the district.
(6) The district shall plan any construction or acquisition of any such waterworks or water supply systems, shall enter into such contracts and shall arrange such financing as to assure that the district shall receive * * * revenues from the operation of the waterworks and water supply systems or any part thereof sufficient to defray all direct and indirect costs, whether administrative, operational or otherwise, of administering, operating and maintaining such waterworks and water supply systems, to pay interest and principal (whether at maturity or upon sinking fund redemption) on bonds of the district issued pursuant to this act and to fund reserves for debt service, for operation and maintenance and for renewals and replacements, and to fulfill requirements of any rate covenant with respect to debt service coverage contained in any resolution, trust indenture or other security agreement relating to the bonds of the district issued pursuant to this act. * * *
SECTION 7. Section 51-9-205, Mississippi Code of 1972, is amended as follows:
51-9-205. (1) The district shall have the power and is hereby authorized, from time to time, to issue bonds without notice and without an election on the question of the issuance thereof in such principal amounts as the district may determine to be necessary to provide sufficient funds for achieving the purposes of this act, including, without limiting the generality of the foregoing, to defray the cost of the acquisition, construction, improvement or extension of the waterworks or water supply systems or any part thereof, whether or not such facilities are owned by the district, the payment of interest on bonds of the district issued pursuant to this act, establishment of reserves to secure such bonds and payment of the interest thereon, expenses incident to the issuance of such bonds and to the implementation of the district's waterworks, water supply systems and all other expenditures of the district incident to or necessary or convenient to carry out the purposes of this act. The bonds authorized by this act shall never constitute nor give rise to a pecuniary liability of the district, or a charge against its general credit or taxing powers and shall not constitute general obligations of the state.
(2) Bonds of the district issued pursuant to this act shall be payable from and secured by a pledge of all or any part of the revenues under any contract entered into pursuant to this act as well as from all or any part of the revenues derived from the operation of the waterworks and water supply systems or any part thereof, as may be determined by the district, subject only to any agreement with the registered owners of the bonds. Such bonds may be further secured by a trust indenture between the district and a corporate trustee, which may be any trust company or bank having powers of a trust company within or without the state.
(3) Bonds of the district issued pursuant to this act shall be authorized by a resolution or resolutions of the district. Such bonds shall bear such date or dates, mature at such time or times, bear interest at such rate or rates, be in such denomination or denominations, be in such form, carry such conversion privileges, have such rank or priority, be executed in such manner and by such officers, be payable from such sources in such medium of payment at such place or places within or without the state, provided that one (l) such place shall be within the state, be subject to such terms of redemption prior to maturity, all as may be provided by resolution or resolutions of the district; however, such bonds shall not bear a greater overall interest rate to maturity than that allowed in Section 75-17-103, Mississippi Code of 1972.
(4) Bonds of the district issued pursuant to this act may be sold at a price not less than ninety-seven percent (97%) of par value plus accrued interest, at public or private sale, at such times as may be determined by the district to be in the public interest, and the district may pay all expenses, premiums, fees and commissions which it may deem necessary and advantageous in connection with the issuance and sale thereof.
(5) Any pledge of earnings, revenues or other monies made by the district shall be valid and binding from the time the pledge is made. The earnings, revenues or other monies so pledged and thereafter received by the district shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the district irrespective of whether such parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is created need be recorded.
(6) Neither the directors of the district nor any person executing the bonds shall be personally liable on the bonds or be subject to any personal liability or accountability by reason of the issuance thereof.
(7) Whenever any bonds shall have been signed by the officer(s) designated by the resolution of the district to sign the bonds who were in office at the time of such signing but who may have ceased to be such officer(s) prior to the sale and delivery of such bonds, or who may not have been in office on the date such bonds may bear, the manual or facsimile signatures of such officer(s) upon such bonds shall nevertheless be valid and sufficient for all purposes and have the same effect as if the person so officially executing such bonds had remained in office until the delivery of the same to the purchaser or had been in office on the date such bonds may bear.
SECTION 8. Section 51-9-213, Mississippi Code of 1972, is amended as follows:
51-9-213. The district shall have power in connection with the issuance of its bonds to:
(a) Covenant as to the use of any or all of its property, real or personal.
(b) Redeem the bonds, to covenant for their redemption and to provide the terms and conditions thereof.
(c) Covenant to charge rates, fees and charges sufficient to meet operating and maintenance expenses, acquisition, renewals and replacements, principal and debt service on bonds, creation and maintenance of any reserves required by a bond resolution, trust indenture or other security instrument and to provide for any margins or coverages over and above debt service on the bonds deemed desirable for the marketability of the bonds.
(d) Covenant and prescribe as to events of default and terms and conditions upon which any or all of its bonds shall become or may be declared due before maturity, as to the terms and conditions upon which such declaration and its consequences may be waived and as to the consequences of default and the remedies of the registered owners of the bonds.
(e) Covenant as to the mortgage or pledge of or the grant of a security interest in any real or personal property and all or any part of the revenues from any water treatment, waterworks or water supply systems or any part thereof or any revenue-producing contract or contracts made by the district with any person to secure the payment of bonds, subject to such agreements with the registered owners of bonds as may then exist.
(f) Covenant as to the custody, collection, securing, investment and payment of any revenues, assets, monies, funds or property with respect to which the district may have any rights or interest.
(g) Covenant as to the purposes to which the proceeds from the sale of any bonds then or thereafter to be issued may be applied, and the pledge of such proceeds to secure the payment of the bonds.
(h) Covenant as to the limitations on the issuance of any additional bonds, the terms upon which additional bonds may be issued and secured and the refunding of outstanding bonds.
(i) Covenant as to the rank or priority of any bonds with respect to any lien or security.
(j) Covenant as to the procedure by which the terms of any contract with or for the benefit of the registered owners of bonds may be amended or abrogated, the amount of bonds the registered owners of which must consent thereto and the manner in which such consent may be given.
(k) Covenant as to the custody of any of its properties or investments, the safekeeping thereof, the insurance to be carried thereon and the use and disposition of insurance proceeds.
(l) Covenant as to the vesting in a trustee or trustees, within or outside the state, of such properties, rights, powers and duties in trust as the district may determine.
(m) Covenant as to the appointing and providing for the duties and obligations of a paying agent or paying agents or other fiduciaries within or outside the state.
(n) Make all other covenants and to do any and all such acts and things as may be necessary or convenient or desirable in order to secure its bonds, or in the absolute discretion of the district tend to make the bonds more marketable, notwithstanding that such covenants, acts or things may not be enumerated herein; it being the intention hereof to give the district power to do all things in the issuance of bonds and in the provisions for security thereof which are not inconsistent with the Constitution of the state.
(o) Execute all instruments necessary or convenient in the exercise of the powers herein granted or in the performance of covenants or duties, which may contain such covenants and provisions as any purchaser of the bonds of the district may reasonably require.
SECTION 9. Section 51-9-221, Mississippi Code of 1972, is amended as follows:
51-9-221. The state hereby covenants with the registered owners of any bonds of the district that so long as the bonds are outstanding and unpaid the state will not limit or alter the rights and powers of the district under this act to conduct the activities referred to herein in any way pertinent to the interests of the bondholders including, without limitation, the district's right to charge, collect and revise rates, fees and charges and to fulfill the terms of any covenants made with the registered owners of the bonds, or in any other way impair the rights and remedies of the registered owners of the bonds, unless provision for full payment of such bonds, by escrow or otherwise, has been made pursuant to the terms of the bonds or the resolution, trust indenture or security instrument securing the bonds.
SECTION 10. This act shall take effect and be in force from and after its passage.